Markets pare some losses but continue to trade in red

Indian equity markets have pared some of their early losses but continue to trade in red, down by over a quarter percent in afternoon session, due to profit-booking by investors after recent gains amid mixed Asian cues. Depreciation in the rupee too dampened sentiment. The rupee slipped from a one-month high by depreciating 8 paise to 65.75 against the US dollar at the Interbank Foreign Exchange in early trade on Monday on foreign funds outflows amid fresh demand for the American currency from importers. Investors failed to draw any sense of relief with the Finance Minister Arun Jaitley’s statement that India’s economic growth is expected to improve despite unfavourable global winds as the government continues with several reform programmes.

On the global front, Asian markets were trading mostly in red; after the US Federal Reserve’s decision to keep interest rates at record lows raised fresh concerns about growth globally. Back home, at present, both Sensex and Nifty were trading above the crucial 26,100 and 7,950 levels respectively. The market breadth on BSE was positive in the ratio of 1276:911 while 81 scrips remained unchanged. Traders were seen piling up position in Capital Goods, Bankex, Infrastructure, PSU and Auto, while selling was being seen in FMCG, IT, Consumer Durables, Oil & Gas and Metal.  In scrip specific development, share of Vivimed Labs is trading up after the company’s API manufacturing facility in Spain has made a favourable outcome post its USFDA inspection that was conducted during the second week of September and concluded on 18th of this month.
 
The BSE Sensex is currently trading at 26148.53, down by 70.38 points or 0.27% after trading in a range of 25972.54 and 26148.83. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.27%, while Small cap index gained 0.79%.

The top gaining sectoral indices on the BSE were Capital Goods up by 0.66%, Bankex up by 0.37%, INFRA up by 0.37%, PSU up by 0.26% and Auto up by 0.26%,while FMCG down by 0.56%, IT down by 0.27%, Consumer Durables down by 0.26%, Oil & Gas down by 0.24%, Metal down by 0.22% were the losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 1.55%, Maruti Suzuki up by 1.24%, Axis Bank up by 1.14%, Larsen & Toubro up by 0.91% and SBI up by 0.35%. On the flip side, Reliance Industries down by 1.54%, HDFC down by 1.37%, Dr. Reddys Lab down by 0.99%, NTPC down by 0.98% and ITC down by 0.91% were the top losers.

Meanwhile, finance minister Arun Jaitley has asserted foreign investors that India would give better returns on investments than many other countries. Noting that the government is putting special focus on improving ease of doing business he said that foreign investments can provide great additional resources for infrastructure and other sectors.

Jaitley said that the country’s infrastructure sector needs huge investments. Railways, highways and power sectors are among those that require funds and the success of projects in these areas would largely depend on bankability. He said that the government is giving special focus on improving the ease of doing business in the country with initiatives like 'Make In India' designed to boost the manufacturing sector that has huge potential.

FM who is on Singapore and Hong Kong visit seeking to attract foreign investors, including large asset managers, to the Indian markets, emphasised that the government wants to resolve expeditiously the entire instability on the taxation matters as “tax uncertainty does not help the investment environment”. He added that “We inherited a legacy of several tax disputes. Perhaps, this was one of the tougher challenges we had.”  He also said that we are very eager to reach a resolution.

Looking to attract more overseas investors, he said Digital India and Make in India (initiatives) are designed to give special boost to manufacturing and India has huge potential in these areas. On concerns that the reforms pace has turned slow, Jaitley said, “I don’t share that perception because the government has been moving very consistently on its reforms agenda with a clear-cut direction.

The CNX Nifty is currently trading at 7957.30, down by 24.60 points or 0.31% after trading in a range of 7908.35 and 7965.15. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Tata Power up by 1.56%, Maruti Suzuki up by 1.21%, Axis Bank up by 1.12%, Kotak Mahindra Bank up by 0.88% and PNB up by 0.79%. On the flip side, Reliance Industries down by 1.42%, Ultratech Cement down by 1.29%, Asian Paints down by 1.19%, HDFC down by 1.18% and Dr. Reddys Lab down by 1.00% were the top losers.
 
Asian markets were trading mostly in red; Nikkei 225 decreased 362.06 points or 1.96% to 18,070.21, Hang Seng decreased 269.93 points or 1.23% to 21,650.90, Taiwan Weighted decreased 155.1 points or 1.83% to 8,307.04, KOSPI Index decreased 29.67 points or 1.49% to 1,966.28, FTSE Bursa Malaysia KLCI decreased 21.89 points or 1.31% to 1,647.56, Jakarta Composite decreased 9.01 points or 0.21% to 4,371.31 and Straits Times decreased 7.52 points or 0.26% to 2,872.07, while Shanghai Composite increased 28.39 points or 0.92% to 3,126.30.